Metalfrio Solutions S.A. (FRIO3) Earnings Call Transcript & Summary

Hello, everyone. Welcome to the webcast of Metalfrio Solutions related to the results of the first quarter of 2025. I invite you to kindly follow the 8 slides that are made available in our website, which will serve for this presentation. In Slide #2, we highlight the key financial figures for the period. Net revenues of 543.6 million reflecting a growth of 25.2% in comparison to the same period last year. Gross profit went up 12.3%. There was a small erosion on the cost of materials as we will see. So margin -- gross margin is a little bit below same period last year, reaching a 16.9% which is still a good margin, but slightly below the same period of last year. Coming down to an EBITDA of 52.6 million, which is almost a 19% growth in comparison to the first quarter of 2024. In terms of margins, we reached 9.7%, which is slightly below the last year. for the increase of raw materials in a comparative basis. Net profit or net loss, it's 9.2 million due to currency adjustments and financial expenses. In Slide #3, we show the breakdown of that growth per region. And here you see that EMEA gained relevance in comparison to the other regions, given the growth that we posted in this period. So we got to a 544 million turnover for the quarter with a growth of 25.2% with the contribution from all regions. 24.6 million from South America, 6.7 million from Central North America and a full 78 million from EMEA out of the factory in Turkey mainly. In Slide #4, we show the net revenue breakdown per region and per services and products as well. South America grew 12.8%, being 14.9% out of services and 8.6% coming from products. Central and North America grew 7.7%, with 8% coming from services and 3.7% from products. As per EMEA, the growth was 50.3%, 51.3% coming from services and 42.8% coming from products. You see a solid growth both in products and services, but especially in services, the strong growth in all regions, proving the strategy very successful. In Slide #5, we see the breakdown of the growth at EBITDA from 44 million to 53 million. You see 7.5 million coming out of Brazil, 0.7 million out of Central and North America and only 0.1 million coming from Turkey. Brazil, is experiencing a record EBITDA margins of 14%, which is presumably one of the best in our business on a global scale, if not the best one. On Slide #6, looking at our balance sheet, you will see that with the capital increase that took place in the first quarter of last year, we are showing a much stronger picture now in terms of the capital structure of the company. In Slide #7, we show the operational cash flow picture for the quarter. It's been a very intensive quarter in terms of cash demands in Turkey for the high turnover as you saw earlier. And that has affected the net debt with a small growth that basically comes from this cash consumption and it also affects the leverage of the company as a whole. But the projection is that those receivables will translate into cash for next quarters and we will reduce the level of the leverage of the company. And for my last slide, the picture of our working capital. Typically, the first quarter is the quarter that is more intensive on cash requirements for stocks and receivables. So that's why the picture for the cash cycle in days it's higher than the previous quarter. But if you -- the right comparison would be the same portion of last year, given the seasonality of the business. So you see -- still see there an improvement from 86 days last year to 77 days digit. Thank you very much for your time and the interest in our company. We remain available here at any time for clarifications. Thank you, and goodbye.